Mr. Peter OppenheimerApple, Inc.June 28, 2011Page 22.
With regard to the disclosures provided in your Forms 10-Q and Form 10-K, pleaseexplain further the following:
If there is at least a reasonable possibility that a loss exceeding amounts alreadyrecognized may have been incurred you must either disclose the estimated additionalloss, or state that such an estimate cannot be made. Please tell us, whether youbelieve that it is reasonably possible that additional losses would be material and, if so, how your disclosures comply with paragraphs 3 through 5 of ASC 450-20-50 andQuestion 2 of SAB Topic 5Y. To the extent that you have determined that it isreasonably possible you will incur a loss in excess of the amounts already accrued,but such amounts are not material, revise your disclosure to clearly indicate as such.
Tell us what you mean by the statement that the company does not have a potentialliability related to any current legal proceedings and claims. In this regard, explainfurther what you mean by “potential liability” and tell us how you determined thatyour reference to “potential liability” complies with the terminology in ASC 450-20-50 (e.g. probable, reasonably possible or remote loss contingency).
Considering management’s assertions that the company does not have any potentialliabilities that would have a material adverse affect on your financial condition orresults of operations, please explain further your disclosures where you indicate “[i]f the Company failed to prevail in any of these legal matters or if several of these legalmatters were resolved against the Company in the same reporting period, theoperating results of a particular reporting period could be materially adverselyaffected.” Tell us your consideration to clarify these disclosures using terminologywithin the guidance of ASC 450. For instance, revise to clarify whether youdetermined that the likelihood of not prevailing in any of these matters in the samereporting period is remote, reasonably possible or probable. Also, tell us if youomitted the statement of changes in stockholders’ equity and statement of cash flowsfrom your disclosures for a particular reason.We urge all persons who are responsible for the accuracy and adequacy of the disclosurein the filing to be certain that the filing includes the information the Securities Exchange Act of 1934 and all applicable Exchange Act rules require. Since the company and its management arein possession of all facts relating to a company’s disclosure, they are responsible for the accuracyand adequacy of the disclosures they have made.In responding to our comments, please provide a written statement from the companyacknowledging that:
the company is responsible for the adequacy and accuracy of the disclosure in the filing;